Chances of a world-wide free trade deal dimmed as India took a principled stand on food subsidies at a World Trade Organisation summit in Indonesia.

US trade representative Michael Froman pleaded with the 159 WTO member states to work past their differences to finalise a slimmed-down free trade deal.

"Let us not sugar-coat reality. Leaving Bali this week without an agreement would deal a debilitating blow to the WTO as a forum for multilateral negotiations," he told dozens of trade ministers.

"If that happens, the unfortunate truth is that the loss will be felt most heavily by those members who can least afford it," he threatened.

But Indian Trade Minister Anand Sharma stood firm and left little hope for a breakthrough.

His government opposes a provision that could endanger subsidies for grains under an Indian policy to feed its poor.

"Agriculture sustains millions of subsistence farmers - their interests must be secured," he said.

"For India, food security is non-negotiable."

But European Union trade commissioner Karel De Gucht struggled to save the talks, claiming that India's concerns should not be a deal-breaker.

"It should be possible to find a solution provided that everybody is showing the necessary flexibility," he said.

Free trade advocates claim the talks will either produce a deal that could boost global trade by $1 trillion (£600 million) or spell the end of the WTO as a forum for negotiations.

They say an agreement would level the playing field by forcing all countries, rich and poor, to follow the same trade rules.

And they claim that, with fewer trade barriers, goods and services of all types would be more affordable, creating more employment and business opportunities.

Critics of the WTO warn that the body is a tool of transnational companies and any deal would favour developed countries over developing economies.

They warn it would hinder countries setting their own priorities in environmental protection, workers' rights and food security.